By Nkiruka Nnorom, Prince Okafor & Elizabeth Adegbesan
…Blames weak operating environment
Moody’s Investors Service has said that Nigeria’s weak operating environment posed a challenge to the banking sector in maintaining the recent improving trend, particularly as regards asset quality, given the increasing bank lending.
With the challenging environment and recent changes in the outlook on Nigeria’s ratings to negative, the rating firm has dropped its outlook on top Nigerian banks’ long-term deposit ratings to negative from stable.
The banks are Access Bank Plc, Zenith Bank Plc, First Bank of Nigeria Limited, United Bank for Africa Plc, Guaranty Trust Bank Plc, Union Bank of Nigeria Plc, Fidelity Bank Plc, FCMB (First City Monument Bank) Limited and Sterling Bank Plc.
Moody in its report at the weekend, stated: “The rating action follows Moody’s decision to affirm Nigeria government’s long-term issuer ratings of B2 and change its outlook to negative from stable on 04 December 2019.”
However, the firm affirmed the B2 long-term local currency deposit ratings for the banks.
“The affirmation of the ratings reflects the banks’ financial profiles which have been generally resilient to the difficult operating environment in Nigeria.